How much pre-deposit is required to file a GST appeal under Section 107

Question

I received a GST demand order and I want to appeal it, but I have heard I need to deposit some amount first before the appeal is even accepted. Before I spend money on it, I want to know whether Central Goods and Services Tax Act, 2017, Section 107 gives me a remedy here and what proof I would need. Any Section numbers I can quote when I write to them would be useful.

MyVakeel Legal Desk · Accepted Answer

Central Goods and Services Tax Act, 2017, Section 107, Central Goods and Services Tax Act, 2017, Section 112 and Central Goods and Services Tax Rules, 2017 is what decides this question in India. Read it alongside the provisions named, because the relief available to you turns on the facts you can prove on paper.

Section 107 of the Central Goods and Services Tax Act, 2017 requires an appellant to pre-deposit the full amount of tax, interest, fine, fee and penalty admitted, plus ten percent of the disputed tax amount, subject to a prescribed monetary ceiling, before an appeal to the first appellate authority is entertained.

For a second appeal to the Goods and Services Tax Appellate Tribunal under Section 112, an additional pre-deposit of a further percentage of the disputed tax amount is required, again capped at a prescribed ceiling, in addition to whatever was already deposited for the first appeal.

The pre-deposit can be made using the electronic cash ledger or, for the disputed tax component, in some cases through the electronic credit ledger, and once made, recovery proceedings for the balance disputed amount are automatically stayed until the appeal is decided.

Failure to make the required pre-deposit results in the appeal being rejected as not maintainable without any consideration of the merits, so taxpayers must arrange the deposit amount before the limitation period for filing the appeal expires.

Where the pre-deposit itself is disputed as excessive or wrongly computed, the taxpayer can seek clarification from the appellate authority, but there is generally no statutory power to waive the mandatory pre-deposit altogether.

What to do next: 1) Compute the admitted tax amount and ten percent of the disputed tax for pre-deposit; 2) Deposit the amount through the electronic cash or credit ledger on the GST portal; 3) Attach proof of pre-deposit while filing the appeal in Form GST APL-01; 4) Track the automatic stay on recovery once the appeal is admitted.

If you are unsure whether your facts fall inside Central Goods and Services Tax Act, 2017, Section 107, that is worth checking with an advocate before you commit to a route, because switching later costs time. You can post the details on the MyVakeel forum for a practising advocate to review, or book a paid consultation with a Bar Council verified lawyer in tax law.